HOSPITALITY

Hospitality, Leisure & Travel

HOSPITALITY

 

To supplement the 10 questions provided in Issue 128 of Board Perspectives: Risk Oversight, the following additional questions are offered to directors serving on boards of hospitality companies. Hotels are the primary focus of these questions; however, many, if not most, of the questions also are applicable to timeshares, hospitality REITs, large casino companies, cruise lines and theme parks.

 

  1. With respect to guest and team member health and safety:
    • What are we doing to create a safe environment through appropriate protocols, policies and processes to prevent infections and/or the spread of COVID-19 – for example, capacity limitations at food and beverage outlets, pools, and other common areas; cleaning standards; elimination of unnecessary items in rooms that complicate cleaning or could contribute to the spread of disease (such as magazines, food service menus, robes, slippers and hangers); and temperature monitors?
    • How are we ensuring that team members and guests are aware of the health and safety protocols and policies we have established?
    • How are we ensuring that the new standards we set are, in fact, being met over time? What mechanisms are in place to keep management informed?
  2. What are our crisis management and response protocols for identifying, reporting and escalating new COVID-19 infection cases and outbreaks? How are we addressing necessary emergency response procedures to contain infections and protect other guests and team members from an outbreak?

     
  3. Regarding guest experience:
    • What is our plan for attracting guests, driving revenue (leisure and transient business travel, food and beverage, group, and other revenues) and quelling COVID-19 concerns?
    • How do we envision creating memorable guest experiences post-COVID-19 crisis, particularly with preventive protocols in place?
    • Have we established conflict resolution measures for managing guests who refuse to abide by our health and safety protocols and policies?
  4. How are we building, restoring and retaining loyalty during this time of limited travel, continued self-isolation and modified guest experiences? How do we know that our efforts on this front are making a difference?

     
  5. Given the industry’s commitment to the environment, the communities we serve, human rights, sustainable operations and responsible sourcing, what are we doing to ensure our environmental, social and governance (ESG) programs remain a priority, and that we achieve our publicly disclosed goals? How do we keep our ESG programs imbedded in our corporate culture in a COVID-19 world?

     
  6. We know that we must do everything we can to prevent COVID-19 infections or, in the event of identified infections, prevent an outbreak, and to comply with OSHA, ADA, and the overall health and safety concerns of our guests and team members. Are our companywide efforts to do so sufficient to reduce the risk of reputation damage and brand erosion from protracted litigation to an acceptable level?

     
  7. With respect to staff reductions (both temporary and permanent):
    • What are we doing to ensure processes are performed and controls are operating effectively despite the workforce reductions? For example, how do we know that all critical processes are performing as intended and at the right time? That adequate oversight is being given to critical functions? That appropriate segregation of incompatible functions exists?
    • How are we preserving our organizational culture given the changes taking place?
    • What are we doing to ensure adequate resources are available to ramp up staffing as operations come back online, considering the pace of the recovery? Though all indications point to a multi-year recovery, have we considered alternative recovery models (e.g., slow, moderate and rapid) to assess how resilient we would be?
    • If our employees have been furloughed for a long period of time, it is likely that many will take other jobs. Therefore, will we have the resources we need to effectively run the property and maximize the guest experience?
  8. Is the appropriate playbook in place to systematically restore our operations? Is that playbook known by everyone who matters? How will we know it is followed so we achieve a recovery that best meets the needs of our guests and team members while also preserving their health and safety?

     
  9. With regard to protecting physical and information assets:
    • How are we ensuring that hotels closed to guests are adequately and efficiently protected and maintained during the shuttered period?
    • What are we doing to ensure corporate and site-level information assets are appropriately protected during this period of high separation (i.e., furloughs and layoffs), consolidation of roles and responsibilities, and continued (and in some cases, escalating) threats from bad actors?
    • How are we protecting the privacy of our loyalty program members and guests?
  10. What have we done to ensure sufficient cash and liquidity to sustain operations throughout the crisis and to protect the enterprise’s long-term financial strength?
    • Have we evaluated our cash flow and financing needs in view of alternative recovery scenarios?
    • Based on our assessment, do we face any challenges with regard to meeting debt covenants? If so, have we requested the appropriate waivers?
  11. How are we preserving and strengthening owner relationships during this crisis (for example, offering assistance with completing SBA PPP applications, offering franchise fee relief, relaxing brand standard requirements)?

     
  12. What are we doing to leverage technology to create a safer environment, enhance the guest experience and drive loyalty?
    • How are we using technology to monitor and manage guest safety?
    • Is our technology infrastructure sufficient to support an increased reliance on online systems and mobile apps as guests seek to reduce human interaction?
    • Are mobile apps and automated rooms appropriately secured to protect guest information and privacy?
  13. What is being done to ensure key vendors, suppliers and service providers are able to meet their obligations and SLAs (to avoid disruption or degradation in service or the guest experience)?

     
  14. What is being done to ensure we are meeting global regulatory requirements (e.g., GDPR, CCPA, PCI, SOX and gaming regulations) during this dynamic period?

     
  15. With the suspension of certain services that have, in the past, differentiated brands (e.g., spas, room service, member lounges, business centers) and the relaxing of brand standard requirements, is it time to reimagine our brand identity? Given changes in traveler preferences stemming from COVID-19, are our brands relevant today and for the foreseeable future? What opportunities exist to serve new and evolving traveler segments?

     
  16. As countries, states, counties, townships and other local municipalities establish, refine and change reopening criteria, how are we managing the varied and evolving COVID-19 obligations in the markets we serve? How are we ensuring compliance today and over time in this fluid environment?

 

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